The average annual cost of regulation, paperwork and tax compliance for companies with fewer than 500 employees is about $5,000 per employee. For companies with more than 500 employees, the cost is about $3,400 an employee.

Source: Small Business Administration.

The PEO industry is estimated at $30 billion. Although that might sound like a lot already, the Raymond James report says that with 98 percent of the market untapped, the potential worth is an astounding $1 trillion.

Source: 1996 report called "Professional Employer Organizations: Changing the Face of Business," conducted by Raymond James & Associates Inc., an investment firm based in St. Petersburg, Fla., .

• Number of Americans co-employed by a PEO: 2.5 million
• Average number of employees per PEO client: 14
• Average gross pay per employee: $19,659
• Annual PEO industry growth rate: 20 percent to 30 percent
• Number of PEOs in the U.S: 2,000
• Percent of businesses with fewer than 100 employees in a PEO: 2%
• Average length of PEO contract: 1 year
• Number of states that require PEOs to be licensed: 16